.png)
6 hours ago
8
Vistry Group, one of Britain’s biggest housebuilders, has said it will make a loss in the first half of the year, after it resorted to heavy discounting to attract buyers for unsold homes .
Vistry shares fell by 8% after the firm also announced its finance director was leaving.
Adam Daniels, the new chief executive, has been in post for three months and has pushed through price cuts to shift homes that are not selling despite Britain’s housing crisis.
Vistry, formerly known as Bovis, had £600m-worth of unsold private homes at the start of the year, but has roughly halved this to less than £300m. It said £190m of the reduction would come through once the sales completed between now and December.
The average discount it offered to private buyers was 7.1%, up from 1.4% in the first half of last year.
Vistry now expects to make a loss before tax of £30m between January and June, worse than its estimate in May, when it forecast a significantly reduced profit compared with last year. Vistry has slowed or delayed building on some sites.
After a positive start to the year, market conditions worsened in the second quarter, reflecting increased uncertainty and lower customer confidence caused by the Middle East war, Vistry said. Mortgage rates increased after higher inflation raised expectations of Bank of England interest rate rises, although concerns have eased recently.
However, Vistry is not expecting any short-term improvement in the market: “Although we would welcome some demand-side stimulus we are not anticipating a significant change in open market conditions in the second half, or in early 2027,” it said.
Vistry is seeking to slash its annual cost bill by £25m through voluntary redundancies – less than 5% of the workforce have applied so far – and more selective hiring. It directly employs 4,400 people, according to its last annual report.
Vistry’s chief financial officer, Tim Lawlor, will leave in October after four years with the company. He is taking up a similar role in a large privately owned business in a different sector.
In recent years, Vistry has shifted towards building social homes in partnership with housing associations, local authorities and build-to-rent investors, and is negotiating new framework deals with 10 of its main partners.
There are concerns over when state funding for these projects will be made available under Labour’s £39bn social and affordable housing programme. The grants, for which Vistry’s partners have applied, are expected in the coming months.
after newsletter promotion
Anthony Codling, housing analyst at RBC Capital Markets, questioned Vistry’s latest guidance. “Why not take the opportunity to suggest that changes at the top of their biggest client [the UK government] may slow the deployment of the social and affordable housing programme?
“Why report that market conditions declined in the second quarter without suggesting this might have a negative knock-on impact on Q3 and Q4? This was his [Daniels’] opportunity to score a goal from the penalty spot whilst there was no goalkeeper between the posts. This was not just a missed goal, it was an own goal.”
After a string of profit warnings in 2024, mainly caused by losses at its south division, Vistry reorganised its operations and has tried to win back the trust of investors. However, its share price has lost almost two-thirds of its value over the past year.
Vistry rebranded from Bovis, which had made headlines for poorly built houses a decade ago. It took over the housebuilding division of Galliford Try in a £1.1bn deal in 2020 and acquired its smaller rival Countryside for £1.3bn two years later.
Vistry and its Countryside Partnerships division are among large housebuilders who face a multibillion-pound class action lawsuit over claims that they colluded over higher prices for homebuyers.
